Oil and natural gas production on federal land is declining

Offshore Overview Last week, the Obama administration announced their new five-year offshore drilling plan. Sadly, the plan is what we have come to expect from an administration hostile to using our domestic energy resources.

Here are a few facts everyone should know about offshore oil and gas production:

• 2.2 percent of offshore areas are leased for oil and natural gas production[1]
• Oil and natural gas production on federal lands has fallen by over 40 percent since 2000[2]
• Since 2000, oil production on private and state lands has risen by 11 percent and natural gas production has riven by 40 percent[3]
• When President Obama was elected, all offshore lands were available for leasing except for a small area near Florida's coast
• The Obama administration's new five-year plan doesn't allow oil and natural gas exploration or production on the vast majority of taxpayer-owned offshore areas

A Mere 2.2 Percent of Taxpayer-Owned Offshore Areas are Leased

Many people thought of the Bush administration as pro-oil and natural gas. But the reality is different. The amount of federal lands offered for lease for energy production actually fell during the Bush administration. In other words, the Clinton administration offered more lands for lease than the supposedly pro-oil Bush administration. Only after oil hit $147 a barrel did the Bush administration end the moratorium on offshore drilling and produce a new drilling plant to expand leasing. Their belated attempts to allow development of taxpayer-owned resources were undermined when President Obama was inaugurated. At the start of the Obama administration, the entire Outer Continental Shelf (OCS) was open to leasing. The administration's new plan, however, doesn't allow leasing on the vast majority of the OCS.

Oil and natural gas production on federal lands has declined by over 40 percent since 2000

Obama administration officials are busy trying to convince people that they are leasing enough lands. In Politico, Interior Secretary Ken Salazar recently wrote that "total U.S. crude oil production was higher in 2010 than in any year since 2003. The Obama administration continues to take meaningful steps to grow America's domestic energy economy and secure our energy future." Salazar describes this as being "on the right path." The problem is that this increase came in spite of federal policies, not because of them. Salazar conveniently omitted the fact that oil and natural gas production on federal lands has fallen off sharply since 2003. Oil production on federal lands fell by 44 percent while natural gas production on federal lands has fallen by 41 percent.[4] The reason oil and natural gas production has increased in the U.S. is because of production on private and state lands. One example is North Dakota's oil production. Almost all of the Bakken formation is on private lands and as a result production has dramatically increased. Over the past 10 years, North Dakota oil production has increased by nearly 250 percent, while federal oil and natural gas production has fallen over 40 percent. The Obama administration's policies are limiting access to taxpayer-owned natural resources, limiting job opportunities, and limiting economic growth. With unemployment stubbornly stuck at 9 percent, the administration should provide more opportunities to use our domestic energy resources instead of severely limiting access to them.

Supplemental Graphs:

Oil production on private and state lands has increased by 11 percent over the past decade, while production on federal land continues to decrease. Natural gas production on private and state lands has dramatically increased over the past decade, while again, production on federal land continues to decrease. [1] See Bureau of Ocean Energy Management, Regulation and Enforcement, Offshore Energy and Minerals Management, boemre.gov. According to the administration's website, the outer continental shelf is 1.76 billion acres ( page 1) and only 38 million acres are leased (Department of Interior, Oil and Gas Lease Utilization -- Onshore and Offshore, page 4). That is a mere 2.16% of the entire Outer Continental Shelf. [2] See Energy Information Administration, Annual Energy Review 2010, Table 1.14 Fossil Fuel Production on Federally Administered Lands, 1949-2010, Oct. 19, 2011. [3]Id. [4] See id.

Institute for Energy Research——Bio and Archives

The Institute for Energy Research (IER) is a not-for-profit organization that conducts intensive research and analysis on the functions, operations, and government regulation of global energy markets. IER maintains that freely-functioning energy markets provide the most efficient and effective solutions to today’s global energy and environmental challenges and, as such, are critical to the well-being of individuals and society.